Tiger Airways and regulators talk about grounding

Australian operations by Singapore’s Tiger Airways were grounded on Saturday on safety fears.

Travel Insurance News - 04/07/2011

<< Ash latest problem for Australian tourism | Travel News | Revamp of ATOL holiday scheme announced >>

Singapore-based budget carrier Tiger Airways is to hold talks with Australia’s regulators after the airline’s planes were grounded in Australia over concerns about safety. Australia’s Civil Aviation Safety Authority (CASA) acted on Saturday amidst claims about the safety of the budget airline’s operations.

The disruption to operations at Tiger Airways comes just as the year’s biggest school holiday season kicks off. The busy travel period means price competition is less intense.

News of the development led to shares in Tiger Airways collapsing nearly 2- per cent in Singapore on Monday. Flights of the carrier’s domestic flights in Australia will remain grounded until 9 July.

The airline’s flights to Singapore have not been affected. The news also drove up shares in competitors. Shares in Virgin Australia rose 10.5 per cent and Qantas was up by 6.5 per cent.

Tiger Airways CEO Tony Davis has flown into Australia for meetings with the CASA. In a statement to Singapore’s stock exchange, the airline said Mr Davis would be responsible for getting its Australian aircraft flying again.

Tiger has a fleet of 10 Airbus A320s operating domestically in Australia. Some 9,000 people fly every day on Tiger’s 60 domestic flights.

The grounding of an entire fleet is unprecedented in the history of Australian air travel. CASA said it grounded Tiger’s fleet after the carrier had failed to address the body’s safety worries.

CASA said it believed that allowing the carrier to continue flying would pose an imminent and serious risk to air safety.

<< Ash latest problem for Australian tourism | Travel News | Revamp of ATOL holiday scheme announced >>